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New program helps students "SALT" away financial knowledge

Sarah Cozzini, left, a senior at Metropolitan State University of Denver, answers telephone calls from students and parents in her job as a peer counselor in the school's financial aid office. (Erin Hull, The Denver Post)

When it comes to managing her student loan debt, Sarah Cozzini knows she's better off than many of her peers. But there are times, she admits, when even her weekends can become filled with dread.

"I think I have an optimistic viewpoint — I have backup plans for my backup plans — but I'll be studying or something and I'll just start thinking about my loans," she said. "I've tried to steer away from taking them out, but sometimes it's just inevitable."

A senior at Metropolitan State University of Denver, Cozzini works multiple jobs to pay for school. As a result, she'll manage to keep her loans to under $20,000 when she graduates next summer. But in one of her gigs, working as a peer counselor in the financial aid department at the school, she's seen fellow students accumulate almost three times that amount.

"That makes me sad because you know how tough it's going to be for them later," she said. "And you can see how distressed they are about it."

With student loan debt in the United States expected to reach $1.2 trillion this year, that stress is being felt all over. One service that hopes to help borrowers navigate the process and perhaps ease some of those worries is SALT. Sponsored by American Student Assistance, a non-profit organization based in Boston, SALT got its name from one of the earliest forms of currency.

The program's stated goal is to "develop financial competencies in college students and alumni."

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In Colorado, Metro State and Colorado State University-Pueblo are the only schools that have contracted with SALT, which works with about 200 colleges and universities nationwide. Both schools recently launched the free program, with one of the desired goals being to lower the loan default rate of their students. At Metro, that figure was about 10.7 percent for 2011-12, and about 15 percent at CSU-Pueblo.

SALT's website, saltmoney.org, provides users lots of financial information, including how loans work and what repaying them will entail, showing monthly payment amounts — and the accompanying interest rates — for terms stretching from seven to 35 years. There are interactive features on the organization's website that help users with budgets, as well as searching for grants, scholarships and internships.

There's even an app that will monitor a student's expenditures, providing an easy-to-understand view of where the money goes.

Last month, President Barack Obama spoke of a crisis in higher education. He said college tuition has increased by more than 250 percent over the last three decades, citing figures from the not-for-profit College Board, which works to help students be successful in college.

As a result, more and more students have turned to taking out loans to help pay for those increases. That has subsequently led to more debt — and more students unable to pay back what they borrow. While the national default rate on student loans is a little more than 9 percent, in Colorado, it's presently at 17 percent, the fourth-highest figure in the nation.

That's left schools scrambling to address the problem. The University of Colorado at Boulder, for example, created a "Money Sense" program in 2009 to help educate students about finances, but this August it hired a full-time "financial educator" for students on the campus.

At CSU-Pueblo, officials are stressing the idea of completing degrees in a timely fashion, preferably in four years but no more than five. But there, as well as other schools, that goal can be waylaid when students need remedial courses at the start of their careers. At CSU-Pueblo, in the fall of 2012, 49 percent of first-year, full-time students required developmental instruction.

In her recent state of the university address, president Lesley Di Mare said those numbers, and the resulting impact on student debt, have to be addressed.

"Default rates are bad for both the student and the institution," she said. "Students who leave us with high debt and worse yet, no degree, will in all likelihood struggle financially for a number of years."

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